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Income Tax Appellate Tribunal, “A” Bench, Mumbai
O R D E R Per B.R. Baskaran (AM) :-
The appeal filed by the assessee is directed against the order dated 12- 02-2013 passed by Ld DIT (Exemptions), Mumbai rejecting the application of the assessee seeking approval u/s 80G of the Act.
The assessee herein is registered u/s 12A of the Act on 19.11.1993. It runs schools and colleges. It obtained recognition u/s 80G of the Act earlier and the same was valid up to 31.3.1995. Thereafter the assessee did not renew the recognition for a quiet long time. The assessee moved an application on 27.03.2012 for renewal of recognition. The Ld DIT took the view that the assessee has not properly explained the inordinate delay in seeking renewal of 80G approval. Further Ld DIT noticed that the assessee has taken loan from trustees & others. As per the provisions of Bombay Public Trust Act, 1950, the trustees are required to obtain previous sanction of the Charity Commissioner for borrowing moneys. The Ld DIT noticed that the assessee trust has obtained loan
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We heard the parties and perused the record. The Ld A.R submitted that the provisions of sec. 80G(5) prescribes the conditions that are required to be fulfilled for obtaining approval u/s 80G of the Act and the assessee has fulfilled all the conditions. He submitted that failure of the assessee to obtain previous sanction from the Charity commissioner for availing loan should not come in the way of the Ld DIT in granting approval u/s 80G of the Act. On the contrary, the Ld D.R strongly defended the order passed by Ld DIT.
Having heard rival submissions, we are of the view that the Ld DIT was not justified in rejecting the application of the assessee for the reasons stated by him. We are of the view that the Ld DIT is required to satisfy himself that the assessee has satisfied the conditions prescribed u/s 80G(5) of the Act before granting approval to the assessee u/s 80G of the Act. We notice that the Ld DIT has not examined the same. The violation, if any, of the provision of a State Act, in our view, should not come in the way of processing the application filed u/s 80G of the Act, unless the provisions of Income tax Act provide for examination of the same. Since the assessee is not seeking recognition retrospectively, the delay in filing application seeking renewal may not be relevant. Accordingly we are of the view that the application filed by the assessee should be examined afresh. Accordingly we set aside the order passed by Ld DIT and restore the matter to his file with the direction to examine the application of the assessee afresh in accordance with the law, after affording necessary opportunity of being heard to the assessee.
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